Default registered after 1 late payment

rickbooth86

Hey guys,

I'm just looking for some advice. I had an account with the car finance company where I paid £85 a month. Last April I missed the payment because I had a lot going on and it just slipped my mind. In May when I realised I made 2 payments in order to catch up and then continued to pay until I decided to just clear the remaining balance in October.

Now on my credit file the account shows as defaulted/satisfied and they won't remove it or even change it so just show the one late payment. I can't have this on my file for another 6 years as I want to be able to secure a mortgage in that time. So I'm just wondering what my options are? If any at all.

I will try and add a screenshot of the account on my credit file.

Thanks,
Rick

[Deleted User]

You can try and dispute it - but it's down to them if they want to default you - the payment should have been made on time

Candyapple

The free versions to check your credit files are below:
Experian: https://www.moneysavingexpert.com/creditclub
Equifax: https://www.clearscore.com
Call Credit: https://www.noddle.co.uk


Take a screenshot of how it shows on all 3 of your files please.

Brock_and_Roll

The account was in default and that default has been satisfied - that is a matter of fact and if you could simply get them removed it would defeat the objective of having credit records on the first place.


On the bright side however, as an isolated incident this will have diddly squat impact on your ability to get a mortgage from any lender that have more than an ounce of common sense.


To prevent any repetition, why not set up a DD?

tenchy

What's the definition of a default? Here, from the ICO:


"A ’default‘ on your credit file simply means that the lender considers that the relationship between you has broken down. "


Hardly the case here - one late payment!!


Get on to the lender and educate them in this matter.


It seems that credit referencing needs some sort of hands-on regulation if this can happen.

DCFC79

You say "had a lot going on and it just slipped my mind", but why was a direct debit not setup, it would prevent payments being missed.

Candyapple

Brock_and_Roll wrote: »

The account was in default and that default has been satisfied - that is a matter of fact and if you could simply get them removed it would defeat the objective of having credit records on the first place.

One month's late payment does not equate to the severity of a default notice. If that was the case, millions of people would be hit with defaults every month for making late payments on credit cards, loans etc.

The Information Commissioner’s Office (ICO) says :

“As a general guide, [a default may be recorded] when you are 3 months in arrears, and normally by the time you are 6 months in arrears.

There are exceptions to this which may result in a default being recorded at a later stage, such as secured or long term loans e.g. mortgages, or if the product operates in a more flexible way e.g. current accounts, student loans, home credit.

So the OP is well within their rights to challenge this if indeed they have been hit with a default.

Brock_and_Roll wrote: »

On the bright side however, as an isolated incident this will have diddly squat impact on your ability to get a mortgage from any lender that have more than an ounce of common sense.

Wrong on so many levels. Any history of defaults / late payments / CCJs on your history will mean you are subject to subprime lenders which will mean a higher interest rate and especially if your default is in the last 6 months, they may require a substantial amount for a deposit e.g. 30% on top of this.

sourcrates

Agree with Candyapple on this.

If it was just one late payment, then that does not warrant a default, and under ICO guidelines, that being the case, the default appears to of been incorrectly applied.

You should write and complain to the lender, and if not satisfied, escalate to the ICO.

badmemory

But you should use this as a learning experience. You are intending to take out a mortgage, which normally entails several regular bills. If "life gets in the way" often, then you will need to set up direct debits & set aside a short period every month to ensure that those direct debits are going to be paid. Otherwise you will land up with defaults on a regular basis, then come remortgage time the whotsit is going to hit the fan.

forgotmyname

What company are you paying that did not setup a DD for the loan?

One of the give anyone credit type companies with high interest rates?

rickbooth86

Hi sorry for the late reply.

The company is The Car Finance Company. I had a DD set up with them but due to having an accident in the car and needing to buy a new car the DD was cancelled and a new payment plan with them was set up as the amount I was paying changed. I should have set up another DD but hindsight is a wonderful thing.

The annoying thing is the account doesn't even show on my Clearscore or MSE Credit Club reports. I've attached a screenshot of the Noddle report.

Edit: It won't let me post as I am a new user so I have used the trusty copy and paste!

Account start date 06/01/2015
Account end date 02/11/2017
Opening balance £ 8,000
Regular payment £ £ 166
Repayment frequency Monthly
Date of default 05/06/2017
Default balance £ 576
Status history
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
2017 1 . D . D . D . D . D . D
OK . OK OK . OK . AA . DF DF . DF . .. .. SF

To me (and to other lenders I'm guessing) it looks as though I missed Aprils payment and then never caught up which just isn't true at all.

Thanks for the feedback,
Rick